Newsletters - Past Issues

Open letter to investors Nov 20 2023

Greetings and salutations!

Wanted to update a bit on the markets. First of all I had a total knee replacement on Nov 8th and as always, the office staff and Jess covered me while I was in surgery. The next day, known as day one was brutal. The last 5 or 6 days haven’t been fun either but stayed away from the drugs mostly. On occasion however, they were absolutely necessary!

On to the markets: Hunkered down in T bills and the like may have avoided a negative market in the early fall and late summer.  

This week saw a lower inflation metric float in. Now be clear, I do not think we will get inflation under control and look for an article on that soon that I will send to you shortly.

However the markets trade on sentiment, not reality. The markets REFLECT reality eventually but trade on the sum of the beliefs of all the traders in it on any given day.

That said, the most recent belief is the FEDS are done with interest rate increases. I tend to agree. But I differ in why I believe this. The FEDS believe inflation is abating but they are not sure. The RATE of inflation indeed may be slowing, but it’s still up. Sort of like a drug addict claiming he has kicked the habit because he has slowed his increasing dosage but still increases it with every fix.

Yea, it is sort of like that.

The news media and the public dissemination and analysis of the inflation data is very skewed in my opinion. Slowing inflation is not SOLVED inflation.

Inflation is still a very serious threat to both the markets and the consumer. The only way we would see relief is if we saw reduced prices, or what is called deflation. In that way we could get back to where we were. But with higher wages being demanded across many union fronts, wage push inflation is probably right behind the inflation we are already seeing.

The point is that not only have prices increased already damaging consumer pocketbooks, inflation may be slowing but it is STILL RISING.

That said, the markets are looking at the slowing inflation data as a good enough reason to make the markets run, at least temporarily. Therefore in a more aggressive stance as far as being in or out of a larger position of equities, we may have dipped our toes a little more into various stocks and indexes.

I will be, given my opinion of the markets, fast on the trigger finger to dump if indeed the markets turned down again. Nothing is guaranteed of course, we can only attempt to protect portfolios when it comes to events happening in the macroeconomic arena.

What may be our largest holdings, EIi Lilly, and Novo Nordisk, which both make the ground  breaking weight loss drugs that also appear to help with other addictions, are gaining traction once again as each subsequent news announcement excites investors. We may continue to hold these as I think these drugs will drive prices much higher. My opinion of course.

Technology seems to be in rotation again, and we may be seeing the start of the Santa Claus rally. The Santa Claus rally is a theory that stocks rally going into Christmas because of the enlightened mood of investors. It is interesting to note that the news media’s claims that increased sales point to a healthy consumer. But remember, they do not count number of units sold, they only count the total nominal amount of sales. So we must ask ourselves, with inflation, it is fairly obvious that more money is being spent on goods and services because of the much higher prices we have seen with our inflation, but figure might not mean more units were sold. They don’t track that figure in the aggregate so we may never know. But we can use common sense. Higher prices means more money spent, and not necessarily more actual units sold.

I am of the opinion, that there have actually been fewer units sold, as we see a few percentage points of increase in total sales while inflation is running much higher than a measly few percentage points. It is the reason every year we see increasing Christmas sales, even as the economy may be spiraling.

But it makes for good news spin doesn’t it? Especially coming into an election year.

In my opinion sales volume should be replaced with number of units sold. That would give us a better indication of how the economy is doing.

For now, we will dip more toes in the proverbial waters as the market may be setting up for a mini-bull period as we move towards the holidays, yet always with an eye on the exit doors if necessary.

In conclusion, if anything has changed in your financial situation, or anything else that I should know about, please contact me. I will check back in a while. I am hoping this knee surgery recovery goes well and appreciate all the well wishes.

We will talk in a bit, 

“Watching the market so you don’t have to”

Marc

 

 

 

Call me

(530)559-1214

 


 

Monthly services for homeowners November 2 2023

Monthly Services worth the money.

 

My electrical service is the often beguiled PG&E. My gas needs are propane and my water is from a well. All three have inelastic pricing which means I have no bargaining power with any of the companies that provide these essentials.

Since the cost of these things are going up in price along with everything else, the budget gets a squeeze with every new bill in the mailbox.

Years ago when my electrical bill hit over $700.00, I decided to seriously adopt some practices to reduce it. The old PG&E slogan “Kill a watt” came to mind and we began shutting off the lights when we left the room, unplugged all those little black converter boxes the kids had for toys they never used, turned down the automatic timers that controlled various lights, pumps and electrical equipment, and generally reduced our power consumption during high peak times whenever we could. As a result, the bill dropped about $200/mo. A victory for sure and one that not only saved me money but also a tiny slice of the planet.

Fast forward to today and I have Tesla solar array that cost me nothing. Back ten years ago or so, the company was called Solar City, before Tesla absorbed it. The deal was Solar City would put an array on my house for free, and I would pay them $.16 a kWh for everything it generated.

It is not large enough to power the entire house, but the way PG&E charges you, called the tier system, they charge you more per kWh the more power you use. The Tesla panels therefore help knock me down the costs to the lower tier usage and therefore cheaper levels. This makes the $.16/kWh I pay Tesla a bargain.

I ended up saving about $150 a month. Not great but I had absolutely had no out of pocket expense (which would have been about 30 grand) and Tesla is responsible for its maintenance for life. They monitor it 24hr/7 and if something goes wrong, they know about it immediately and send someone out to fix it, no charge.

As for propane, well on that one I am stuck. I tried switching companies every so often for the teaser rate, but changing tanks every time I did that was a pain. And the initial deals they offer you to switch expire quickly so you are soon right back paying regular prices.

I could own my own tank, but besides being a hassle to do so, I would then be on the hook for its integrity and safety and that I am not interested in.

As for water, I have a well. One would think wells provide free water and they do. It’s the equipment to get the water out of the well and to the house that costs. Obviously the pump uses electricity, and the well pump is an expensive little bugger. About every 7 years I lose a pump or its motor and then it needs to be pulled out and replaced. I have my home warranty to cover that, but the warranty costs me as well.

I also need a water softener to make the acidic water from the well compatible with my pipes. The water softener needs bags of salt every other week and calcite every 6 months. It breaks every so often so there is more cost there. I lose a water heater every 4 years or so no matter what I do. The water tests neutral and they tell me the softener works but I still lose water heaters. My toilet and sink valves that go into the wall also rot out every few years and I have a couple of dozen of those. More fodder for my home warranty, which in itself costs money.

To pay the ever increasing costs of these essentials are just a small part of what us home owners have to deal with. Doing the best we can to conserve, I am kind of like you.

I have to work a little harder and get up a little earlier to afford to run the homestead at today’s rates.

In conclusion, the cost of everything we need is skyrocketing beyond belief but you already know that don’t you?

Just know that I too, feel your pain.

It is what it is and we deal with it.

“Watching the markets so you don’t have to”    

(end)    

(As mentioned please use the below disclaimer exactly) THANKS   (Regulations)    

This article expresses the opinion of Marc Cuniberti and is not meant as investment advice, or a recommendation to buy or sell any securities, nor represents the opinion of any bank, investment firm or RIA, nor this media outlet, its staff, members or underwriters. Mr. Cuniberti holds a B.A. in Economics with honors, 1979, and California Insurance License #0L34249 His insurance agency is BAP INC. insurance services.  Email: news@moneymanagementradio.com


 

Down the rat hole Month services are covered Oct 14 2023

 

Yumm- Wires for lunch

 

 

 

 

We often go into the weeds on economic issues here in Money Matters. Today, instead of going into the weeds however, we'll go down the rat hole.

 

Literally.

 

One wouldn't think that rats have anything to do with economics, but these furry little bastards just had a sizeable economic effect on my budget when they chewed away at not one, not two, but three of my cars electrical systems.

 

I had no idea rats held an affinity for wiring, but they do, and it cost me over two grand in total to fix all three cars.

 

All three cars were covered with one of those car covers at one time or another and that was the only similarity between them. My daughter was away at college so I covered her Mazda for a few months. The two other cars I cover to preserve the paint since they don't get driven more than once a week or so.

 

I do have a monthly pest service but it wasn't until the cars warning lights came on and we got the cars up on a rack that we discovered why the various electrical systems went out. The rodents had munched through various wires and harnesses on all three cars.

 

It was then I called the pest company and they informed me that covered cars can become homes to rats seeking shelter. Rats need to sharpen their teeth and they did so on my vehicles costing me a S**T load of money.

That got me thinking about my monthly services in general and the ones I have, which are few. But it can be an economically viable in certain cases to have a monthly service versus calling a company every time you have problem.


The three monthly services I have are pest control, a home warranty and a pool service. I have good reasons for having all three.

I once had rats in a house in Marin County. And you never just have one rat. They infested the walls before I even knew what happened. I tried trapping them myself, and that turned out to be a nightmare. We tried poison, and the rats died inside the walls. What a cluster that was.

If you have a bad pest problem, or a rat or mouse shows up, you have to address it immediately. If you don't have a monthly service, you have to schedule a one-time service call. They’ll likely charge you up a “visit” charge just to come out along with the actual service charge. If they have to come back out, bang, another fee. It’s pretty much the same with a lot of service contractors.

In contrast, I pay about the pest guys $43 a month for whatever I need, whenever I need it. I call them any time and they come out the next day and they take care of everything, no questions asked, and no bill. They even have non-toxic solutions. So I'm good with that.

 

On the pool service, I guess I could do that myself, but I had small children in the house, and I did not want the chemicals around. With all the businesses I have, I am very busy. I just don't have time to balance the pH and various chemicals and I suck at it anyway.

I am told that if you get the wrong PH or a chemical imbalance, you can possibly stain the bottom and sides of the pool as well as damage the equipment. So the monthly service fee here also made sense for our family.

 

Finally, I have a home warranty service. I pay about $150 a month now, up from about $60 a month when I started 15 years back. There is a $100 charge every time you call but over the years I have had almost every appliance replaced as well a couple of well pumps, a heater and pool pump. There is no doubt I have saved tons of money and stress using this service.

 

I will continue to have all of these contracts as they make economic sense because they have saved me time, money and stress over the decade and a half I have used them.

 

Whether you decide any monthly services for your home maintenance requires a bit of research and some simple math. Taking a few minutes to see what contract services are available on a monthly basis versus calling someone out every time you have a problem may be a worthwhile endeavor.

“Watching the markets so you don’t have to”    

(end)    

(As mentioned please use the below disclaimer exactly) THANKS   (Regulations)    

This article expresses the opinion of Marc Cuniberti and is not meant as investment advice, or a recommendation to buy or sell any securities, nor represents the opinion of any bank, investment firm or RIA, nor this media outlet, its staff, members or underwriters. Mr. Cuniberti holds a B.A. in Economics with honors, 1979, and California Insurance License #0L34249 His insurance agency is BAP INC. insurance services.  Email: news@moneymanagementradio.com

 

Have questions on the markets ?
Call me (530) 559 1214


 

 


 

Update Oct 8 2023

 

 

Alert- with the upheaval and violence in Israel, prepare for market upset. Does your advisor have an exit point. In 50 years of doing this I know of none. Hold for the long term? Not now kids- earn 5.3% on certain Treasury fund, even MONEY MARKET FUNDS!  
Why risk a gain of 5% in the market if you could lose 20% or more!  During COVID MARCH 2020, the Dow dropped 38% in 15 trading days. A one million dollar account would mean a loss of $25,000.00 A DAY!

What would/did your advisor say to calm your panic?

Lucky for you the market came back.

I have a plan for the market upset I think is COMING as sure as darkness follows the daylight.

Hey, do you think they put me on 67 radio stations or in a dozen major news outlets for being wrong?

Call me- accepting new clients due to a bigger office staff. 
Earn 6.45% FIXED and guaranteed for FIVE YEARS.  Do you really think the FEDS can keep rates this HIGH for THAT LONG?

Dont kid yourself- They have not been able to do that for over 50 years!

Freeze todays high rates.

 Or earn over double digits every year for the rest of your life? Is that possible? Guaranteed with ALSO participation in the stock market in the UPWARD direction only?

Call me and find out!

(530) 559-1214

Disclaimer: This is not a recommendation to buy or sell any securities. May include forward looking statements. Past performance is not a guarantee of future results. No one can predict market movements at any time. Investing involves risk. You can lose money, including total loss of principal. Consult your tax advisor for all income tax related questions. Stop-loss strategies utilize stop orders which turn into market orders, so they may not limit losses. Dividends are not guaranteed and may be cut or eliminated at any time and may not prevent losses. Annuities are not FDIC insured and are insured and guaranteed by the underlying insurance company only. Early withdrawal penalties may apply. Management fees are not allowed once funds are moved to an annuity. Annuities may or may not be suitable for all investors. Indexed funds attempt to track the underlying index but are only a proxy for that index and may or may not track the index exactly. 

Special note: For those wishing principal guarantees and possible market upside participation, you may consider a fixed indexed annuity. Purchased annuities have no management fees and are 100% principal protected. These I have found are desired by those that cannot tolerate any losses whatsoever, or are extremely sensitive to any kind of loss. They also will participate (rise in value) if the market (S&P 500) rises between the applicable time periods as set forth in the contract, so they have a minimum guaranteed interest of 7.2% over the life of contract OR you get a portion of the increase in the market. The greater amount of the two is what they guarantee and always 100%


 

Money News update September 28, 2023

 

 

Are we in for more pain?

Read on and I agree

Marc Cuniberti

"Watching the markets so you don't have to"

Expect a personal market update soon!

 

 

A recession is all but inevitable for the U.S. and investors should be playing defense in that kind of environment, according to the head of the TCW Group.

“We are going to have a recession, because that’s the way the world works,” Katie Koch, CEO of the firm with $210 billion under management, said Thursday at CNBC’s “Delivering Alpha” conference. “We haven’t had a real one for over a decade and a half.”

 

While Wall Street has been bracing for a contraction for much of the past two years, the U.S. economy has stayed afloat due largely to a resilient consumer flush with cash and a labor market that has remained powerful.

However, Koch said the Federal Reserve’s interest rate hikes targeted at slowing the economy and bringing down inflation will start to bite. Higher rates have long been thought to work with lag effects, the timing of which is uncertain and dependent on a variety of factors.

“I do think it pays to be patient and wait to see higher rates work their way through the system,” Koch said. “We haven’t seen the pain of higher rates, but it’s coming.”

From an investment standpoint, Koch recommends a mostly conservative array of choices that includes cash. She also spoke favorably of agency debt, mortgage-backed securities and Treasurys, as well as companies that have longer-duration capital.

But Koch worries about consumers as well as companies that have used the “extend and pretend strategy” to put off paying down loans.

 

“That is the bedrock of the U.S. economy, obviously the consumer and small and medium companies, and I think they are going to struggle to finance themselves in this environment and that further leads us to a relatively bearish outlook,” she said.

 

 

UPDATED THU, SEP 28 202311:35 AM EDT 

YAHOO FINANCE  JEFF COX


 
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